Wearied by a two-year standoff, state mining regulators and Denver Water officials on Monday demanded that Cotter Corp. clean up a mine leaking uranium into a creek that reaches a drinking-water reservoir.

State officials also said a $1.2 million bond posted by Cotter is insufficient to clean up the Schwartzwalder mine should the company walk away.

“I want to get this remediated. If Cotter wants to continue to fight this in court, that’s up to them,” said Loretta Pineda, director of Colorado’s Division of Mining Reclamation and Safety. “We’re rapidly losing another construction season. … Cotter could at least be doing work on a diversion.”

Uranium contamination from Schwartzwalder reaches Ralston Creek northwest of Golden, which flows into a reservoir that supplies drinking water for 1.3 million metro residents.

Cotter last year filed a lawsuit accusing regulators of abusing their discretion with orders to clean up Schwartzwalder. But Friday, a Denver District Court judge ruled that Colorado’s Mined Land Reclamation Board was correct to order the de-watering of the 2,000-foot mine shaft and impose penalties.

Earlier in the week, state health officials ordered Cotter to divert creek water around the mine and find the source of the contamination.

Buoyed by the Friday ruling, state regulators met with state Attorney General John Suthers’ staff Monday about their possible next steps.

Tests along Ralston Creek have found elevated uranium levels as high as 310 parts per billion, well above the 30 ppb state health standard for drinking water.

“Fortunately, our treatment process removes uranium and our drinking water is safe, but the elevated concentrations of uranium entering the plant are of concern,” said Tom Roode, Denver Water’s director of operations and maintenance. “We would like to see action to ensure the mine is cleaned up as soon as possible.”

Cotter officials have not responded to phone calls. The company is a subsidiary of San Diego-based defense contractor General Atomics.

Cotter acquired Schwartz walder in 1965 and produced roughly 17 million pounds of uranium for nuclear weapons and power plants. The mine closed in 2000, and water-treatment facilities were dismantled.

In 2007, a state mining inspector detected the water contamination. About two years ago, the state officials began raising concerns, and last year they started pressing for a cleanup.

Cotter has argued that toxic groundwater filling its 2,000-foot-deep mine shaft is not connected to Ralston Creek.

The health department order last week would require Cotter to install a concrete wall and to funnel water into a pipe that would carry Ralston Creek around the mine and then, below the mine, back toward Ralston Reservoir. It’s a temporary solution until a pump-and-treat operation is set up.

The clash with Cotter over this mine — at the same time the company is working on a Superfund cleanup of uranium mill contaminating groundwater near Cañon City — tests Colorado’s ability to hold companies accountable for environmental damage.

State law gives the authority to ensure complete cleanup and restoration of land and water.

But questions remain.

For example, state law requires companies to post sufficient bond money to guarantee that cleanup work will be done without falling to taxpayers. But the bond posted for Schwartzwalder is not enough to cover costs of pumping and treating uranium-laced water from the mine, state mining inspector Tony Waldron said.

State officials said they’ll press now for a larger bond as well as de-watering of the mine.

Colorado’s laws normally are adequate to ensure cleanup and restoration of land while also enabling mining, Pineda said.

The Cotter situation “is an exception,” she said, disputing notions that Colorado is averse to mining.

“Yeah, we are unfriendly to this,” she said. “Colorado is open to responsible mining.”

Bruce Finley covers environment issues, the land air and water struggles shaping Colorado and the West. Finley grew up in Colorado, graduated from Stanford, then earned masters degrees in international relations as a Fulbright scholar in Britain and in journalism at Northwestern. He is also a lawyer and previously handled international news with on-site reporting in 40 countries.

The owners of Boulder’s Sterling University Peaks apartments, who this summer were cited for illegally subdividing 92 bedrooms in the complex, have reached an agreement to settle the case for $410,000, the city announced Thursday.